Question 1

Which of the following is not true regarding depreciation?

Accepted Answer

A) depreciation allocates the cost of a fixed asset over its estimated life. 
B) depreciation expense reflects the decrease in market value each year. 
C) depreciation is an allocation not a valuation method. 
D) depreciation expense does not measure changes in market value. 
A) depreciation allocates the cost of a fixed asset over its estimated life. 
B) depreciation expense reflects the decrease in market value each year. 
C) depreciation is an allocation not a valuation method. 
D) depreciation expense does not measure changes in market value. B

Question 2

For each of the following errors,considered individually,indicate whether the error would cause the adjusted trial balance totals to be unequal.If the error would cause the adjusted trial balance total to be unequal,indicate whether the debit or credit total is higher and by how much.
a- The adjustment for unearned fees of $3,260 was journalized as a debit to Accounts Payable for $3,260 and a credit to Fees Earned of $3,260.
b- The adjustment for supplies expense of $425 was journalized as a debit to Supplies Expense for $542 and a credit to Supplies for $425.

Accepted Answer

a- The trial balance totals will still be equal,but the balances of Unearned Fees and Accounts Payable will be incorrect as the debit should have been made to Unearned Fees instead of Accounts Payable. 
b- The debit total exceeds the credit total by $117.

Question 3

Which of the following pairs of accounts could not appear in the same adjusting entry?

Accepted Answer

A) Service Revenue and Unearned Revenue 
B) Interest Income and Interest Expense 
C) Rent Expense and Prepaid Rent 
D) Salaries Payable and Salaries Expense 
A) Service Revenue and Unearned Revenue 
B) Interest Income and Interest Expense 
C) Rent Expense and Prepaid Rent 
D) Salaries Payable and Salaries Expense B

Question 4

Two income statements for Toby Sam Enterprises are shown below: $ \quad $$ \quad $$ \quad $$ \quad $$ \quad $$\text { Toby Sam Enterprises }$
$ \quad $$ \quad $$ \quad $$ \quad $$ \quad $$ \quad $$\text { Income Statement }$
$ \quad $$\text { For the Years } 2 \text { and } 1 \text { Ending December } 31$
$\begin{array}{l}
\hline \begin{array}{lll}
\
 \text {Fees earned }\
 \text {Operating expenses }\
 \text {Operating income}\
\end{array}
\begin{array}{lll}
\underline {\text { Year 2 }} \
\$ 674,350 \
\underline {472,045} \
\underline {\$ 202,305 }\
\end{array}
\begin{array}{lll}
\underline {\text { Year } 1}\
\$ 520,600\
\underline {338,390}\
\underline {\$ 182,210}
\end{array}
\end{array}$ 
Prepare a vertical analysis of Toby Sam Enterprises' income statements.Has operating income increased or decreased as a percentage of revenue?

Accepted Answer

A) increased by 5% 
B) increased by 111% 
C) decreased by 5% 
D) decreased by 111% 
A) increased by 5% 
B) increased by 111% 
C) decreased by 5% 
D) decreased by 111%

Question 5

The adjusted trial balance verifies that total debits equals total credits before the adjusting entries are prepared.

Accepted Answer

A) True 
 B)False

Question 6

The matching concept supports matching expenses with the related revenues.

Accepted Answer

A) True 
 B)False

Question 7

Classify the following items as: 1. prepaid expense,2. unearned revenue,3. accrued expense,or 4. accrued revenue.
a. fees received but not yet earned
b. fees earned but not yet received
c. paid premium on a one-year insurance policy
d. property tax owed to be paid beginning of next year

Accepted Answer

a .  2 unearned reve

Question 8

An example of deferred revenue is Unearned Rent.

Accepted Answer

A) True 
 B)False

Question 9

Accrued expenses are ordinarily reported on the balance sheet as

Accepted Answer

A) assets 
B) liabilities 
C) fixed assets 
D) prepaid expenses 
A) assets 
B) liabilities 
C) fixed assets 
D) prepaid expenses

Question 10

Explain the differences between
a. Accrued revenues and unearned revenues.
b. Accrued expenses and prepaid expenses.
c. Give an example of each.

Accepted Answer

a.	Accrued revenues are services that ha

Question 11

A business pays biweekly salaries of $20,000 every other Friday for a ten-day period ending on that day.The last payday of December is Friday,December 27.Assume the next pay period begins on Monday,December 30 and the proper adjusting entry is journalized at the end of the fiscal period December 31.The entry for the payment of the payroll on Friday,January 10 includes a

Accepted Answer

A) debit to Salary Expense of $16,000 
B) debit to Salary Expense of $4,000 
C) credit to Salary Payable of $16,000 
D) credit to Salary Payable of $4,000 
A) debit to Salary Expense of $16,000 
B) debit to Salary Expense of $4,000 
C) credit to Salary Payable of $16,000 
D) credit to Salary Payable of $4,000

Question 12

The supplies account had a beginning balance of $1,750.Supplies purchased during the period totaled $3,500 . At the end of the period before adjustment, $350 of supplies were on hand.Prepare the adjusting entry for supplies.

Accepted Answer

The answer of The supplies account had a beginning balance...

Question 13

What is the purpose of the adjusted trial balance?

Accepted Answer

A) to verify that all of the adjusting entries have been posted 
B) to verify that the net income loss is correctly reported 
C) to verify that no adjusting journal entry has been omitted 
D) to verify that the debits and credits balance 
A) to verify that all of the adjusting entries have been posted 
B) to verify that the net income loss is correctly reported 
C) to verify that no adjusting journal entry has been omitted 
D) to verify that the debits and credits balance

Question 14

If there is a balance in the unearned subscriptions account after adjusting entries are made,it represents an

Accepted Answer

A) deferral 
B) accrual 
C) dividend 
D) revenue 
A) deferral 
B) accrual 
C) dividend 
D) revenue

Question 15

If the adjustment of the unearned rent account at the end of the period to recognize the amount of rent earned is inadvertently omitted,the net income for the period will be understated.

Accepted Answer

A) True 
 B)False

Question 16

On November 15,Great Designs Company purchased an advertising campaign for the month of December.Great Designs paid cash of $2,700 in advance.The advertising campaign ran in December.
a. Prepare all necessary journal entries for the advertising campaign for November and December.
b. Explain why you prepared this/these journal entries.

Accepted Answer

a.
b. Under the matching concept,the exp

Question 17

Which of the following accounts would likely be included in a deferral adjusting entry?

Accepted Answer

A) Interest Revenue 
B) Unearned Revenue 
C) Salaries Payable 
D) Accounts Receivable 
A) Interest Revenue 
B) Unearned Revenue 
C) Salaries Payable 
D) Accounts Receivable

Question 18

The updating of accounts is called the adjusting process.

Accepted Answer

A) True 
 B)False

Question 19

The prepaid insurance account had a beginning balance of $6,600 and was debited for $2,300 for premiums paid during the year.Journalize the adjusting entry required at the end of the year,assuming the amount of unexpired insurance related to future periods is $4,100.

Accepted Answer

@#IMG-DLM&
$6,600 +

Question 20

Prepaid expenses are eventually expected to become

Accepted Answer

A) expenses when their future economic value expires 
B) revenues when services are performed 
C) expenses in the period when they are paid 
D) revenues when the liability is no longer owed 
A) expenses when their future economic value expires 
B) revenues when services are performed 
C) expenses in the period when they are paid 
D) revenues when the liability is no longer owed

Which of the following is not true regarding depreciation?

Which of the following pairs of accounts could not appear in the same adjusting entry?

The adjusted trial balance verifies that total debits equals total credits before the adjusting entries are prepared.

The matching concept supports matching expenses with the related revenues.

Classify the following items as: 1. prepaid expense,2. unearned revenue,3. accrued expense,or 4. accrued revenue. a. fees received but not yet earned b. fees earned but not yet received c. paid premium on a one-year insurance policy d. property tax owed to be paid beginning of next year

An example of deferred revenue is Unearned Rent.

Accrued expenses are ordinarily reported on the balance sheet as

Explain the differences between a. Accrued revenues and unearned revenues. b. Accrued expenses and prepaid expenses. c. Give an example of each.

The supplies account had a beginning balance of $1,750.Supplies purchased during the period totaled $3,500 . At the end of the period before adjustment, $350 of supplies were on hand.Prepare the adjusting entry for supplies.

What is the purpose of the adjusted trial balance?

If there is a balance in the unearned subscriptions account after adjusting entries are made,it represents an

If the adjustment of the unearned rent account at the end of the period to recognize the amount of rent earned is inadvertently omitted,the net income for the period will be understated.

Which of the following accounts would likely be included in a deferral adjusting entry?

The updating of accounts is called the adjusting process.

The prepaid insurance account had a beginning balance of $6,600 and was debited for $2,300 for premiums paid during the year.Journalize the adjusting entry required at the end of the year,assuming the amount of unexpired insurance related to future periods is $4,100.

Prepaid expenses are eventually expected to become

Introduction to Accounting and Business

Analyzing Transactions

Completing the Accounting Cycle

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley,internal Control,and Cash

Receivables

Fixed Assets and Intangible Assets

Current Liabilities and Payroll

Corporations: Organization,stock Transactions,and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

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Exam 3: The Adjusting Process

Which of the following is not true regarding depreciation?

Which of the following pairs of accounts could not appear in the same adjusting entry?

The adjusted trial balance verifies that total debits equals total credits before the adjusting entries are prepared.

The matching concept supports matching expenses with the related revenues.

Classify the following items as: 1. prepaid expense,2. unearned revenue,3. accrued expense,or 4. accrued revenue. a. fees received but not yet earned b. fees earned but not yet received c. paid premium on a one-year insurance policy d. property tax owed to be paid beginning of next year

An example of deferred revenue is Unearned Rent.

Accrued expenses are ordinarily reported on the balance sheet as

Explain the differences between a. Accrued revenues and unearned revenues. b. Accrued expenses and prepaid expenses. c. Give an example of each.

The supplies account had a beginning balance of $1,750.Supplies purchased during the period totaled $3,500 . At the end of the period before adjustment, $350 of supplies were on hand.Prepare the adjusting entry for supplies.

What is the purpose of the adjusted trial balance?

If there is a balance in the unearned subscriptions account after adjusting entries are made,it represents an

If the adjustment of the unearned rent account at the end of the period to recognize the amount of rent earned is inadvertently omitted,the net income for the period will be understated.

Which of the following accounts would likely be included in a deferral adjusting entry?

The updating of accounts is called the adjusting process.

The prepaid insurance account had a beginning balance of $6,600 and was debited for $2,300 for premiums paid during the year.Journalize the adjusting entry required at the end of the year,assuming the amount of unexpired insurance related to future periods is $4,100.

Prepaid expenses are eventually expected to become

Introduction to Accounting and Business

Analyzing Transactions

Completing the Accounting Cycle

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley,internal Control,and Cash

Receivables

Fixed Assets and Intangible Assets

Current Liabilities and Payroll

Corporations: Organization,stock Transactions,and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

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